Dispensing Fee
Definition
A dispensing fee is the component of pharmacy reimbursement that compensates the pharmacy for the professional services involved in dispensing a prescription—including pharmacist review, patient counseling, labeling, and other dispensing activities. It is separate from the drug cost component of reimbursement.
In the 340B context, dispensing fees are relevant in contract pharmacy arrangements. When a covered entity uses a contract pharmacy, the pharmacy typically receives a dispensing fee for each 340B prescription it fills on behalf of the covered entity. The fee structure is defined in the contract pharmacy agreement and may be negotiated between the parties.
Dispensing fees also appear in Medicaid reimbursement methodologies, where the total reimbursement is typically expressed as a drug cost benchmark (such as AAC or EAC) plus a dispensing fee.
Frequently Asked Questions
Why Dispensing Fee Matters
Dispensing fees are a component of the economics of contract pharmacy arrangements and Medicaid billing. Covered entities should understand the dispensing fee structure in their contract pharmacy agreements and how it affects the net economics of their 340B program.
How Virtue 340B Uses It
Virtue 340B reviews contract pharmacy agreement terms, including dispensing fee structures, as part of our program optimization and audit services.